The Guideline for the Prevention of Insider Trading

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1 The Guideline for the Prevention of Insider Trading as of November 28, 2007 Member firms are required to establish internal rules which include the items provided in this Guideline in order to prevent insider trading. 1.Compliance with Laws and Regulations (1)A member firm shall make an effort to prevent insider trading by complying with the Financial Instruments and Exchange Act (hereinafter the Act ) and other related laws and regulations. (2)A member firm shall make an effort to help its clients fully understand the significance and contents of the regulations on insider trading, when collecting information, and concluding a contract in relation to its Investment Management Business or Investment Advisory & Agency Business. 2.Information Control on the Material Facts relating to the Business of a Listed Company (1)In this Guideline, information on the material facts relating to the business of a listed company shall mean the following information among the unpublicized facts that executive officers and/or employees of a member firm have come to know in performing their duties. a Decided Facts A decision by an organ of a listed company, (a listed company means a company which is specified in Article 163 Paragraph 1 of the Act) which is responsible for making decisions on the execution of the operations of the listed company to carry out any of the following matters, or a decision by the organ not to carry out the matter which has been decided to be carried out in such a decision (limited to facts that have already been publicized) (see Article 166 Paragraph 2 Item 1 of the Act). However, this shall not apply to the facts which are regarded under the criteria provided by Article 49 of the Cabinet Office Ordinance concerning Regulations on Transactions in Securities (hereinafter the Transaction Regulation Ordinance ) as ones that may have only a minor influence on investors investment decisions. 1

2 1 solicitation for persons who subscribe for shares issued or treasury shares disposed of by a stock company (including persons who subscribe for preferred equity investment issued by a cooperative structured financial institution) as prescribed in Article 199(1) of the Companies Act (including solicitation to be made under laws and regulations in a foreign state equivalent to that provision of the Companies Act (limited to the case where the listed company is a foreign company; hereinafter the same shall apply) in the case of solicitation for persons who subscribe for treasury shares), or solicitation for persons who subscribe for share options for subscription as prescribed in Article 238(1) of the Companies Act 2 reduction of the amount of the stated capital 3 reduction of the amount of capital reserve or retained earnings reserve 4 acquisition of its own shares by the listed company as prescribed in Article 156(1) of the Companies Act (including the cases applied by replacing certain terms under the provisions of Articles 163 and 165(3) of the Companies Act) or under laws and regulations in a foreign state equivalent to these provisions of the Companies Act (limited to the case where the listed company is a foreign company; hereinafter the same shall apply) 5 allotment of share without contribution 6 share split (including split of preferred equity investment prescribed in the Act on Preferred Equity Investment) 7 dividend of surplus 8 share exchange 9 share transfer 10 merger 11 company split 12 transfer or acquisition of whole or part of its business 13 dissolution (excluding dissolution as a result of merger) 14 commercialization of new products or new technology; or 15 business alliance or other matters prescribed in Article 28 of the Cabinet Order for Enforcement of the Financial Instruments and Exchange Act (hereinafter the Enforcement Cabinet Order ) as those equivalent to the matters listed in 1 to 14 A decision by an organ of a subsidiary company of a listed company which is responsible for making decisions on the execution of the operations of the subsidiary company to have the subsidiary company carry out any of the following matters, or a decision by the organ not to have the subsidiary company carry out the matter which has been decided to be carried out in such a decision (limited to facts that have already been publicized) (see Article 166 Paragraph 2 Item 5 of the Act). However, this shall not apply to the facts which are regarded under the criteria provided 2

3 by Article 52 of the Transaction Regulation Ordinance as ones that may have only a minor influence on investors investment decisions. 1 share exchange 2 share transfer 3 merger 4 company split 5 transfer or acquisition of whole or part of its business 6 dissolution (excluding dissolution as a result of merger) 7 commercialization of new products or new technology 8 business alliance or other matters prescribed in Article 29 of the Enforcement Cabinet Order as those equivalent to the matters listed in 1 to 7 b Occurred Facts Occurrence of any of the following facts in a listed company (see Article 166 Paragraph 2 Item 2 of the Act). However, this shall not apply to the facts which are regarded under the criteria provided by Article 50 of the Transaction Regulation Ordinance as ones that may have only a minor influence on investors investment decisions. 1 damage arising from disaster or in the course of performing operations 2 any change of its major shareholders 3 facts that may be a ground for delisting or rescission of registration of specified securities or options pertaining thereto (see Article 163 Paragraph 1 of the Act) 4 matters prescribed in Article 28-2 of the Enforcement Cabinet Order as those equivalent to the matters listed in 1 to 3 Occurrence of any of the following facts in a subsidiary company of a listed company (see Article 166 Paragraph 2 Item 6 of the Act). However, this shall not apply to the facts which are regarded under the criteria provided by Article 53 of the Transaction Regulation Ordinance as ones that may have only a minor influence on investors investment decisions. 1 damage arising from disaster or in the course of performing operations 2 matters prescribed in Article 29-2 of the Enforcement Cabinet Order as those equivalent to the matters specified in 1 3

4 c Information on the Settlement of Accounts Existence of a difference between, on one hand, the latest publicized forecasts (or publicized actual figures of the preceding business year in the case of lack of such forecasts) of net sales, current profits or net income (hereinafter referred to as net sales, etc. in this Article) or of the dividend prescribed in a(a)7 of the listed company or of sales, etc. of the corporate group to which the listed company belongs, and, on the other hand, new forecasts thereof newly prepared by the listed company or the results in the settlement of accounts for the business year of the listed company (see Article 166 Paragraph 2 Item 3 of the Act). However, this shall apply only to those facts which are regarded under the criteria provided by Article 51 of the Transaction Regulation Ordinance as ones that may have only a minor influence on investors investment decisions. Existence of a difference between, on one hand, the latest publicized forecasts (or publicized actual figures of the preceding business year in the case of lack of such forecasts) of net sales, etc. of a subsidiary company (limited to a subsidiary company which has issued securities specified in Article 2(1)(v), (vii) or (ix) of the Act and listed on a Financial Instruments Exchange or other subsidiary company designated in Article 55 of the Transaction Regulation Ordinance) of the listed company, and, on the other hand, new forecasts thereof newly prepared by the subsidiary company or the results in the settlement of accounts for the business year of the subsidiary company (see Article 166 Paragraph 2 Item 7 of the Act). However, this shall apply only to those facts which are regarded under the criteria provided by Article 55 of the Transaction Regulation Ordinance as ones that may have a material influence on investors investment decisions. d Other Material Facts In addition to facts specified in the preceding three items relating to a listed company, material facts concerning operation, business or property of the listed company that may have a significant influence on investor s investment decisions (see Article 166 Paragraph 2 Item 4 of the Act). In addition to facts specified in the preceding three items relating a subsidiary company of a listed company, material facts concerning operation, business or property of a subsidiary company of the listed company that may have a significant influence on investors investment decisions (see Article 166 Paragraph 2 Item 8 of the Act). 4

5 e Information on a Tender Offer A fact concerning launch of a tender offer or a fact concerning suspension of a tender offer, prescribed in Article 167 Paragraph 1 and 2 of the Act. However, this shall not apply to those information which are regarded under the criteria provided by Article 62 of the Transaction Regulation Ordinance as ones that may have only a minor influence on investors investment decisions. (2)A member firm must appoint a chief information officer among its officers and employees (a director or a person in a comparable position). (3)If any person among officers and employees of a member firm has obtained information on the material fact relating to the business of a listed company or information which may fall within the purview of such criteria, he or she shall immediately report such information to a chief information officer (including a person designated by a chief information officer; the same shall apply hereinafter). (4)If a chief information officer has received information relating to the preceding provision from any person among executive officers and employees, the officer shall examine whether or not such information falls within the purview of information on the material fact relating to the business of a listed company, and in case it does, the officer shall give a necessary instruction about how to deal with such information to the person who has reported such information. (5)If any person among executive officers and employees of a member firm has obtained or received information on the material fact relating to the business of a listed company including information which may fall within the purview of such criteria, he or she must not spread such information to any other person whether or not such person belongs to a member firm unless a chief information officer allows him or her to do so. 3.How to Conduct Business A member firm must not take advantage of information on the material fact relating to the business of a listed company when conducting its Investment Management Business or Investment Advisory & Agency Business. However, this shall not apply to the case where such information falls within the purview of any items provided in Article 166 Paragraph 6 or Article 167 Paragraph 5 of the Act. 4.Transactions in Own Accounts A member and its executive officers and employees must not execute transactions in their own accounts based on information on the material fact relating to the business of a listed company. However, this shall not apply to the case where such information falls within the purview of any 5

6 items provided in Article 166 Paragraph 6 or Article 167 Paragraph 5 of the Act. 6